When it comes to trading, there are many different ways to navigate the markets. Percentage allocation management module or percentage allocation money management (PAMM) accounts bring traders and investors together under mutually beneficial terms. But what exactly does PAMM entail and what are the selling points of 4xCube PAMM?
PAMM accounts explained
PAMM accounts have potential benefits for both investors and money managers. This unique product allows investors to earn without having to trade by investing funds into the account of professional traders. Traders can work with multiple investors simultaneously and receive a percentage of the profits they earn from trading investor funds as a reward.
With PAMM accounts, reputable brokerages use advanced software to allow clients the ability to assign all or part of their account to a particular money manager/professional trader. The trader managing the funds then trades his own money as well as the money from other clients who receive a percentage of the profits or losses into their own accounts. The thought is that because the money manager is also trading their own capital, they will work hard to make beneficial trading decisions.
PAMM in action
Here’s an example of a PAMM account in action:
- Money manager A is trading with $10,000.
- Trader B gives $40,000 to be managed.
- Trader C gives $50,000 to be managed.
- The total of the account is now $100,000
The money manager’s percentage allocation is 10%, Trader B has 40% of the pooled money and Trader C has 50%. Trade orders will then be allocated between parties as follows 0.1 lots to the money manager, 0.4 lots to Trader B and 0.5. So, the amount of money you trade in the pooled account will affect the lot percentage.
Selling points of 4xCube PAMM
4XCube is a reputable broker offering automated PAMM investing solutions for ease of understanding and the fair distribution of funds. There are many benefits to the 4xCube PAMM platform including. For instance:
- Trading fees and Performance fees are paid to the account managed on a daily basis meaning you won’t have to wait around for the money due.
- There’s equal and fair distribution of PnL (profit or loss).
- As a money manager, your live performance can be shown to all 4xCube’s client database making it easy to attract new collaborative investors who want to piggyback off your trading knowledge. Remember, many investors are interested in the forex market but don’t have time to trade themselves and are looking for the help of experienced money managers.
- All Power of Attorney (POA) are signed digitally making it easier for any investor to subscribe.
- Any mark-up or commission is allowed.
- PAMM accounts can be set up free of charge with no minimum trading deposit. This is significant considering brokers normally ask for a minimum of $50K investment to provide a Multi-Account Manager (MAM) account. It’s also harder for trade results to be distributed equally via a MAM account.
Find out more about managed PAMM accounts today by contacting 4xCube.com
